Natural Resources Conservation Service’s Financial Statements for Fiscal Years 2020 and 2019
We recommend that NRCS management develop and implement a process that ensures NRCS is utilizing a complete and accurate obligation population for the calculation of the corporate accrual, and formally document an analysis of any differences that are identified from the review.
We recommend that NRCS management implement policies and procedures to perform a quarterly analysis over open obligations marked for review that received no responses from responsible parties to determine if a material amount is being omitted from accrued expenses.
We recommend that NRCS management design, implement, and document policies and procedures to ensure that internal use software is completely and accurately recorded in the general ledger. Such policies and procedures should include a requirement for vendor invoices to be in sufficient detail to provide management with information needed to determine whether incurred costs satisfy the capitalization criteria, as required by Federal Accounting Standards Advisory Board.
We recommend that NRCS management as part of their assessment of service and subservice organizations’ SOC reports, determine whether controls at the service organizations are suitably designed and implemented to prevent, or detect and correct, processing errors that could result in a material misstatement in NRCS’ financial statements.
We recommend that NRCS management consider the structure of the agency and establish reporting lines and organizational structure to define, assign, and limit authorities and responsibilities.